Snap Shares Slide On Weak User Growth

Leanne Cray June 09, 2017
Snap Shares Slide On Weak User Growth

Shares of Snapchat’s parent company recently have been sinking by almost 6% after a most recent application download data showed that the daily active users of the application have declined.

Independent application analytics groups also showed that daily downloads for Snapchat have declined by 22% year over year during the first two months of the second quarter. Snapchat downloads on the iOS alone has plummeted by more than 40% the past couple of months.

Snapchat shares recorded new lows on Wednesday following the release of the data while overall shares of the company have slumped by 20.1% since the debut of the IPO in March. Upon its first day of trading, Snap shares rallied by 44% after its initial offering of around 200 million shares.

Snapchat shares then declined after the performance of its application lagged behind Facebook’s daily active users last month recording only 161 million at the end of 2016 while Facebook-owned Instagram recorded more than 200 million daily active users. Although Snapchat users argued that the application differs from Instagram stories through audience or function, surveys showed that advertisers preferred Instagram stories for its public broadcast model to which attracts more users.

Meanwhile, Snapchat has been placing a number of acquisitions in the past couple of weeks. Just most recently, the company have acquired start-up Placed for around $125 million to $200 million.

Placed currently is a company that holds a specialization in location analytics and attempts to tie in-store visits to ads. The company also offers targeting, insights, and attribution which will probably be utilized by Snap to improve its ad measurement. The company which is currently headed by CEO David Shim will be reporting under Snap chief strategy officer Imran Khan and would be working on the company’s offline sales attribution where online Snapchat ads are converted into actual offline sales. The company currently has more than a hundred employees.

While other details of the acquisition was not released, investors saw the move as an effort to boost its advertising business and level out with the advertising leverage that Instagram stories offer user accounts.

Back in 2015, Snap was able to acquire Looksery which was responsible for the core technology used in the application’s popular animated lenses. The company acquired Looksery for $150 million. Just last year, the company was also able to acquire Bitmoji maker Bitstrips for $64.2 million which gave the company a little but uncredited leverage versus other applications.


You got to be always informed and well equipped with the knowledge you need about business and the market. Our website does the highest quality news reporting to keep you updated about the latest happenings in the world of business. Check us out at bworldfinance.news

Leanne Cray

GET DAILY UPDATES

Sign up to our daily newsletter and get the latest scoop in the tech market!